ANNUAL REPORT 2016 - Tibiyo annual...Dr. Absalom Themba Dlamini Fipha Dlamini Managing Director...

ANNUAL REPORT 2016

Contents

PRESENTATION TO HIS MAJESTY THE INGWENYAMA

MISSION STATEMENT

OBJECTIVES OF THE ORGANISATION

CORPORATE DETAILS

CHAIRMAN’S STATEMENT

MANAGING DIRECTOR’S REPORT

TIBIYO MAIN COMMITTEE

CORPORATE GOVERNANCE

TIBIYO TAKA NGWANE INVESTMENTS

FINANCIAL STATEMENTS

3

4

4

5

6 - 8

9 - 11

12 -13

14

15

16 - 41

TIBIYO TAKA NGWANE ANNUAL REPORT 2017 1

HIS MAJESTY INGWENYAMA KING MSWATI III

2 TIBIYO TAKA NGWANE ANNUAL REPORT 2017

PRESENTATION TO HIS MAJESTY THE INGWENYAMA

Ngwenyama Ndvuna,

Libandla leTibiyo (the Main Committee of Tibiyo) is honoured and privileged to present the Annual Report for the financial year

ended 30 April 2016, covering:

Review of operations of the organisation

Audited Financial Statements

Tibiyo’s Social Responsibility.

May it please your Majesty to receive this report.

BAYETHE! WENA WAPHAKATHI!!

Dr. Absalom Themba Dlamini Fipha Dlamini

Managing Director Chairman



THE OBJECTIVES OF THE ORGANISATION

MISSION STATEMENT

To complement Government in fostering economic independence and self sufficiency;

To increase formal sector employment;

To increase income in the hands of citizens;

To earn and/or save foreign exchange;

To develop the rural communities of the Kingdom;

To foster and support the maintenance of Swazi tradition and cultural heritage;

To assist financially and materially in the education and training of citizens.

To meet its objectives, Tibiyo Taka Ngwane actively promotes the establishment of commercially viable projects

in all sectors of the economy. These projects must satisfy the following criteria:

• National desirability;• Economic viability;• Technical feasibility;• Profitability.

In playing its developmental role, Tibiyo Taka Ngwane cooperates with and appreciates assistance from national

and international investment organisations. It also invites suitable and experienced local as well as foreign

business entities to either form business partnerships or manage its wholly owned projects.

Tibiyo Taka Ngwane (Tibiyo) is a Swazi Nation Organisation that is at the core of the social, cultural and economic development of the Swazi people.


PHYSICAL ADDRESS POSTAL ADDRESS

Lomawa House P. O. Box 181

Lozithehlezi Kwaluseni

M201

TELEPHONE

+268-25101978/9

+268-25101390

+268-25101399 (Fax)

+268-25101306 (Fax)

AUDITORS BANKERS

KPMG

Umkhiwa House

Lot 195 Kal Grant Street

MBABANE

CORPORATE DETAILS

African Alliance Swaziland

First National Bank of Swaziland Limited

Nedbank Swaziland Limited

Standard Bank Swaziland Limited

Stanlib Swaziland

SwaziBank

Swaziland Building Society

TIBIYO TAKA NGWANE ANNUAL REPORT 2016

Prince Fipha Chairman

“

The achievements of the organisation in 2017 would

not have been possible without the tireless efforts of

the Executive Management, Management and the entire

staff of Tibiyo, together with the able leadership and

management of its associate and subsidiary companies.

CHAIRMAIN’S STATEMENT



L ibandla leTibiyo (the Main Committee of Tibiyo) is honoured

and privileged to publish the Audited Annual Financial

Statements of Tibiyo Taka Ngwane for the year ended 30

April 2017, which reflects a 72%, growth in net income.

Tibiyo has invested in the following sectors of the economy:

Agriculture, Commercial, Finance, Services, Property, Mining,

Manufacturing and Processing as well as Tourism.

Revenue from Third Party managed projects increased by 18%

during the reporting period. Interest received from investments

increased by 37.8% and dividends received from investments

showed an increase of 36.7%. Tibiyo’s share of partnership

earnings decreased by 6.8% compared to prior year. The above

factors combined, resulted in a 25.5% increase in revenue for

the review period.

ESWATINI NATION DEVELOPMENT EXPENDITURE

Despite the harsh economic environment, Tibiyo Taka Ngwane

managed to carry out its mandate of developing the nation of

the Kingdom of Eswatini. This includes the promotion of health,

welfare, education and housing of the nation of Eswatini.

The organisation was able to provide efficient services to the

various cultural and traditional institutions of Eswatini, fund

traditional ceremonies, make donations, as well as other areas

that the Ingwenyama considered beneficial to Eswatini.

The Eswatini Nation Development Expenditure increased by

32.2% overall, compared to prior year, mainly due to a 21.8%

increase in expenditure towards bursaries and scholarships and

national ceremonies expenditure which grew by 38.8%.

During the reporting period, a total of 250 new bursaries

and 68 scholarships were awarded. Sixty two (62) students

sponsored by Tibiyo Taka Ngwane completed their tertiary

education during the year, and 320 pupils completed their high

school education under bursaries sponsorship. A total amount

of E38.62 million was spent on bursaries and scholarships in

2017, compared to E31.70 million in 2016.

DOMESTIC ECONOMIC PERFORMANCE

The country’s Gross Domestic Product is estimated to have

grown by 1.9% in 2017, compared to 1.4% in 2016. As

the country experienced recovery from the drought of the

previous two years, improved weather conditions, particularly

the above normal rains received in 2017, impacted positively

on agricultural production, agro-processing, water supply and

hydro-power generation, according to the Central Bank of

Eswatini’s Economic Review Report.

From a decline of 5.6 % in 2016, the primary sector is estimated

to have increased by 0.7% influenced mainly by crop production,

which grew by 17.2%, largely dominated by sugarcane,

following a decline of 21.9 % the previous year. Maize output

rose from 33,462 metric tons in 2015/16 harvesting season

to 84,000 metric tons in the 2016/17 harvesting season.

Sugarcane production on the other hand rose by 7.2% in 2017

following a decline of 14.7% the previous year.

The secondary sector is estimated to have grown by 0.7% in 2017

from 0.5% the previous year. The main contributing factor was

manufacturing, in particular agro-processing, electricity and water

supply. Manufacturing output is estimated to have increased by

1.8%, mainly supported by an increase in sugar production.

The mining sector saw coal production growing from 158,418

metric tonnes in 2016 to 202,277 tonnes in 2017, a 27.7%

growth. The increase in production volumes was a result of

continuous improvement in coal yields. Quarry stone production



CHAIRMAIN’S STATEMENT

meanwhile, decreased from 419,642 cubic metres in 2016 to

291,100 cubic metres in 2017, a 30,6% decline.

The Lilangeni weakened against major external currencies

partly due to global and domestic factors in South Africa. The

Lilangeni remains vulnerable to significant global market events.

GLOBAL ECONOMIC OUTLOOK

The Global Economy in 2017 grew by 3.8% and is expected to

grow by 3.9%, in 2018 and 2019 according to the World Economic

Outlook projections. Growth in emerging markets and developing

economies is expected to rise to 4.9% in 2018 following a 4.8

% expansion in 2017, while growth in advanced economies is

expected to be increase. Looking ahead, emerging markets and

developing economies are expected to expand by 5.1% in 2019.

The South African economy grew by 1.3% in 2017, and

exceeded expectations of 1.0% growth announced earlier. The

growth was driven by the agricultural sector bouncing back from

one of the worst droughts in recent history. The sector grew by

17.7% in 2017.

FUTURE OUTLOOK

Prospects for the country remain indigent as a result of slow

economic growth and a decline in Foreign Direct Investments.

Southern African Customs Union (SACU) revenues are also

projected to decline in 2018.

ACKNOWLEDGEMENTS

The achievements of the organisation in 2017 would not have

been possible without the tireless efforts of the Executive

Management, Management and the entire staff of Tibiyo,

together with the able leadership and management of its

associate and subsidiary companies.

In a special way, I recognise with appreciation, the dedication

and commitment of the Main Committee, together with their

valued support and guidance at all times.

Last but not least, on behalf of the Main Committee,

Management and Staff; I acknowledge with gratitude and

honour, the wise counsel and guidance of His Majesty King

Mswati III throughout the year.

BAYETHE, WENA WAPHAKATHI !!!

PRINCE FIPHA

Chairman



Dr. Absalom Themba Dlamini Managing Director

MANAGINGDIRECTOR’SREPORT

As part of its diversification strategy, the organisation will continue to

explore opportunities in the property portfolio with a view to grow this

sector. In addition, the good rains projected for the country going forward,

call for an aggressive pursuit of new initiatives in the agricultural portfolio

which will create more job opportunities and generate better revenues.



During 2017, the Swaziland economy was on the recovery path,

following the severe drought suffered by the entire country

in 2016 where Tibiyo Taka Ngwane investee companies and

subsidiaries were also affected.

Tibiyo saw an increase in revenue from E239 million in 2016 to

E300 million in 2017, a 26% increase. The main contributing

factor to this growth was an increase in dividends received from

investee companies. Some of the investee companies, especially

in the sugar industry, who adopted new strategies to counter the

prolonged drought effects, were able to reap positive spinoffs,

which saw them achieving budgeted profits, which is commendable.

Net income achieved increased from E145 million to E250 million,

a 72% increase. Total assets, grew from E1.8 billion to E2 billion,

signifying growth of 9%.

SUGAR MATTERS

As sugar accounts for a major portion of Tibiyo’s revenues, it is of

paramount importance to monitor the performance of this industry

and developments thereof.

According to the Swaziland Sugar Association (SSA), in the

reporting period, sugar production increased by 10.9% from

586 085 tons to 650 126 tons, whilst sales revenue declined by

8.8% from E4.6 billion to E4.2 billion in 2017. The decrease in

revenues was mainly due to depressed market prices and lower

sales volumes. Actual sales decreased by 11% from 621 024 tons

to 552 135 tons. Sales to the SACU market decreased by 13.5%

whilst sales to the EU decreased by 36%.

Molasses production increased by 1.5% from 239 337 tons to

242 889 tons. Yields (tons sucrose per hectare) increased from

13.97 to 14.01.

In terms of the short-term outlook for the industry, the evolving

world market conditions, together with the erosion of value in

what were historically preferential markets will remain a challenge.

While the country, as a signatory of the SADC-EU EPA, benefits

from duty-free quota-free access into that market, there is very

little value obtained from sales to that market due to the decrease

in value attainable.

The EU has become a surplus producer and exporter of sugar,

requiring less volumes of imported sugar. Alternative markets in

the East and Southern African region are being actively pursued to

divert sales from the EU market.

The restoration and maintenance of a significant level of protection

of the SACU market through the tariff mechanism in place, is

pertinent to enable the movement of sales into the SACU market.

The deficit regional market (SADC, COMESA and EAC) continues

to present an opportunity for sales into this region. Ongoing

expansions in the sugar producing countries in the region have

translated into a resistance in opening their markets for regional

sugar imports. Anti-sugar campaigns and the rollout of taxes on

sugar containing beverages (commonly termed, the sugar tax)

stands to dampen the demand for sugar.

Sugarcane growing is a large user of water, and water management

for growing of the crop is important for the sustainability of the

industry and environment. With the lessons learnt from the

drought period coupled with increased efficiencies in water use

and irrigation, sugar production is expected to return to levels prior

to the peak of the 2016 drought.

The key to viable and sustainable sugarcane production is keeping

costs of production low, while improving operational efficiencies.

The annual 15% increase in electricity effected in the 2016/17

and 2017/18 financial years, significantly increased the energy

cost of growing sugarcane. With the crop being 100% irrigated,

and irrigation costs making up more than 50% of the overall crop

upkeep, this increase will continue to put pressure on the growers.

The need for alternative and renewable sources of energy for

the irrigation of the crop is becoming imminent with the rise

of irrigation costs. There is also a need to adopt and harmonise

MANAGING DIRECTOR’S STATEMENT - continued


other cost reduction initiatives throughout the industry to retain

value. The SSA will continue to aggressively pursue strategies

that will create sustainable value by focusing on improving the

competitiveness of the industry.

SOCIAL RESPONSIBILITY

In 2017, Tibiyo continued to complement Government’s

development effort through education and training. An amount

of E38.6 million was spent on Bursaries and Scholarships, whilst

E36 million was spent on National Ceremonies within the culture

and traditions portfolio. An amount of E0.4 million was spent on

Donations from E0.1 million spent the previous year.

LONG SERVICE AWARDS

A number of members of staff received long term service awards in

2017. They were awarded as follows:

Mrs Sonile Dlamini - 30 years

Mr William Malaza - 25 years

Ms Phila Dlamini - 30 years

Mrs Nonhlanhla Shongwe - 15 years

Mrs Precious Khumalo - 15 years

Mrs Nomathemba Simelane - 15 years

Tibiyo congratulates these employees and wishes them many years

ahead that are more fruitful in the service of the organisation. Their

loyalty is much appreciated.

RECRUITMENTS

The following members of staff joined the organisation in 2017

1. Vusasive Dlamini - HR Officer

2. Nqabeni Mdlovu - Estates Officer

3. Nyakwesi Motsa - Accountant

4. Simangele Mndzebele - Information Technology

Officer

5. Sibongiseni Mamba - Communications Officer

RETIREMENTS

In 2017, the organisation bid Mrs Sonile Dlamini and Mr Tyrone

Sons farewell as they retired following many years in which

they served the organisation with loyalty and dedication. Their

contribution is much valued.

FUTURE OUTLOOK

The organisation is bracing itself for tough times ahead in light of

a bleak economic outlook going forward and adverse conditions

in the sugar industry, where Tibiyo is heavily invested, mainly

challenges in accessing global sugar markets and the sugar price

volatility.

As part of its diversification strategy, the organisation will continue

to explore opportunities in the property portfolio with a view

to grow this sector. In addition, the good rains projected for

the country going forward, call for an aggressive pursuit of new

initiatives in the agricultural portfolio which will create more job

opportunities and generate better revenues.

APPRECIATION

On behalf of Management and the entire staff, I extend my sincere

gratitude to His Majesty King Mswati III, for his wise leadership in

2017. I also thank profoundly, the Main Committee for its support

and guidance throughout the year.

To the Management and staff, I extend my appreciation for their

continued commitment towards achieving the vision and mission

of the organisation.

BAYETHE, WENA WAPHAKATHI !!!

DR. ABSALOM THEMBA DLAMINI

Managing Director

HRH Princess Sidvumolesihle Chief Ndzabankulu SimelaneHRH Prince Simelane

Chief Ndlaluhlaza Ndwandwe Dr. Absalom Themba Dlamini Mrs. Nokukhanya Gamedze

Prince Fipha

THE MAINCOMMITTEE


Mr. Sigodvo Motsa Mr. Khephu Cindzi Ms. Lindiwe Chola Dlamini

Ms. Nonhlanhla Shongwe Mr. John MngomezuluMr. Manqoba Khumalo

Mr. Winston Lomahoza Mr. Vusi FakudzeMr. Mvuselelo Fakudze


During the year under review, the Main

Committee consisted of 13 members.

Two members resigned. These were Mr.

Mvuselelo Fakudze and Mr Manqoba

Khumalo.

There are three sub-committees of the

Main Committee, the Audit Committee,

the Remuneration Committee and the

Investments Committee, to which specific

duties and responsibilities are delegated

by the Main Committee.

The External Auditors have unrestricted

access to all of Tibiyo’ s Committees and

all the organisation’s records. Their duty is

to report on the maintenance of effective

internal controls over the organisation’s

business.

Chairman

The Chairman is a non-executive member

of the Main Committee and his role as

Chairman is separate from that of the

Managing Director.

Audit Committee

The Audit Committee comprised of the

following members in the reporting

period:-

Mr John Mngomezulu (Chairman),

HRH Princess Sidvumolesihle and Chief

Ndlaluhlaza Ndwandwe. All the Audit

Committee members are non-executive.

The mandate of the Audit Committee

is to ensure compliance with financial

and regulatory frameworks, good corpo-

rate governance, accountability and

transparency in all transactions and

dealings of Tibiyo Taka Ngwane.

Remunerations Committee

The Remuneration Committee, comprises

four (4) non-executive members. It is

responsible for the assessment and approval

of the remuneration structure of Tibiyo. The

Committee is chaired by Mrs Nokukhanya

Gamedze and the other members are

HRH Prince Simelane, Chief Ndzabankhulu

Simelane, and Mr Khephu Cindzi.

Investments Committee

The Investments Committee comprised

of three members during the reporting

period. They are: Mr. Vusi Fakudze who

is chairman, Mr. Sigodvo Motsa, and Ms.

Lindiwe Dlamini.

This committee advises management on

the placement of Organisational funds. It

also advises management on proposed new

projects before they are brought to the

Main Committee for approval. Additional

adhoc members can be co-opted as and

when necessary.

Financial Statements

The Main Committee is responsible for

ensuring the preparation of the Annual

Financial Statements in a manner that

will present the state of affairs and

results of the business operations of

Tibiyo Taka Ngwane in accordance with

stated accounting policies appropriate to

the business of the organisation, which

have been consistently applied. The

organisation’s External Auditors (KPMG),

carry out an independent audit of the

Annual Financial Statements in accordance

with International Standards of Auditing

and report their findings.

Management

The Management Committee meets regul-

arly, to review operational performance,

capital programmes and other relevant

issues. Consideration is also given,

through well-defined structures, to Tibiyo

investments and capital expenditure

proposals and other issues of strategic

importance to the organisation, for

recommendation to the Main Committee.

Internal Controls

Tibiyo maintains internal controls and

systems designed to provide reasonable

assurance as to the integrity of the

Annual Financial Statements and to

verify and maintain accountability of

the organisation’s assets. Such internal

controls and systems are based on

established policies and procedures and are

implemented by trained personnel. The

effectiveness of these internal controls and

systems is monitored by the organisation’s

External and Internal Auditors.

CORPORATE GOVERNANCE


ACTIVITY/PRODUCTS PERCENTAGE HOLDING

AGRICULTURE

Dalcrue Agricultural Holdings (Pty) Ltd Livestock, Sugar cane, Dairy, crops, milling 100.00

Inyoni Yami Swaziland Irrigation Scheme Sugar cane & Livestock 50.00

Sihhoye Estate Sugar cane 100.00

Sivunga Estate Sugar cane 100.00

The Royal Swaziland Sugar Corporation Ltd Sugar cane & Sugar 50.00

Ubombo Sugar Limited Sugar cane & Sugar 40.00

V I F Limited (under Provisional liquidation) Sugar cane 100.00

COMMERCIAL, FINANCE, SERVICES & PROPERTY

Bhunu Mall Property 40.79

Manica Swaziland (Pty) Limited (Dormant) Shipping, Car Rental 25.00

Nedbank (Swaziland) Limited Banking 1.49

Swaziland Development Finance Corporation (FINCORP) SME financier 20.00

Simunye Plaza (Pty) Ltd Property 25.00

The Swazi Observer (Pty) Ltd Newspapers 100.00

Tibiyo Insurance Brokers (Pty) Ltd Insurance Broker 50.00

Tibiyo Properties (Pty) Ltd Property 100.00

MINING

Maloma Colliery Limited Anthracite Coal 25.00

MANUFACTURING & PROCESSING

Parmalat Swaziland (Pty) Ltd Dairy Products 26.00

Swaziland Beverages Limited Beverages 40.00

TOURISM AND TRANSPORT

Royal Swazi National Shipping Corp Ltd (Dormant) Shipping (Containerisation) 76.00

Swazi Spa Holdings Limited Hotels 39.69

Tibiyo Leisure and Resorts (Pty) Ltd, Trading as The Royal Villas Hotel 100.00

Swaziland Empowerment Limited Shareholding 5.41

TIBIYO TAKA NGWANE INVESTMENTS


TIBIYO TAKA NGWANE

FINANCIAL STATEMENTSfor the year ended 30 April 2017

Contents Page

Statement of Responsibility by the Main Committee 37

Report of the Independent Auditors 38 - 39

Report of the Main Committee 40 - 41

Statement of Significant Accounting Policies 42 - 45

Statement of Comprehensive Income 46

Statement of Changes in Funds and Reserves 47

Statement of Financial Position 48

Statement of Cash Flows 49

Notes to the Financial Statements 50 - 59



STATEMENT OF RESPONSIBILITY BY THE MAIN COMMITTEE for the year ended 30 April 2017

Statement of Responsibility by the Main Committee

The Main Committee is responsible for the preparation and presentation of the financial statements of Tibiyo Taka Ngwane, comprising

the statement of financial position at 30 April 2017, and the statements of comprehensive income, changes in funds and reserves, and

cash flows for the year then ended, and the notes to the financial statements, which include a summary of significant accounting policies

and other explanatory notes, and the Main Committees’ report, in accordance with the requirements of the entity’s basis of accounting as

described in the notes to the financial statements.

The Main Committee is also responsible for such internal control as they determine is necessary to enable the preparation of financial

statements that are free from material misstatement, whether due to fraud or error and for maintaining adequate accounting records and

an effective system of risk management as well as the preparation of the supplementary schedules included in these financial statements.

The Main Committee has made an assessment of the ability of the entity to continue as going concern and have no reason to believe that

the entity will not be a going concern in the year ahead.

The auditor is responsible for reporting on whether the financial statements are presented in accordance with the applicable financial

reporting framework. The unqualified opinion of KPMG is presented on pages 18 to 20.

Approval of annual financial statements

The financial statements of Tibiyo Taka Ngwane, as identified in the first paragraph were approved by the Main Committee on

2018 and are signed on its behalf by:

___________________ ___________________Chairman Member

Main Committee

INDEPENDENT AUDITOR’S REPORT To the Main Committee of Tibiyo Taka Ngwane - continued


Opinion

We have audited the financial statements of Tibiyo Taka Ngwane

set out on pages 21 to 41, which comprise the statement of

financial position as at 30 April 2017, and the statements of

comprehensive income, changes in funds and reserves and

cash flows for the nine month period then ended, and notes

to the financial statements, including a summary of significant

accounting policies and other explanatory notes and the Main

Committees’ report.

In our opinion, the financial statements present, in all material

respects, the financial position of the Tibiyo Taka Ngwane as at

30 April 2017, and its financial performance and cash flows for

the year then ended in accordance with the basis of accounting

described in the statement of significant policies, set out on pages

23 to 27.

Basis for Opinion

We conducted our audit in accordance with International

Standards on Auditing (ISAs). Our responsibilities under those

standards are further described in the Auditor’s Responsibilities for

the Audit of the Financial Statements section of our report. We are

independent of the Tibiyo Taka Ngwane in accordance with the

Swaziland Institute of Accountants Code of Professional Conduct

(SIA Code) and other independence requirements applicable to

performing audits of financial statements in Swaziland. We have

fulfilled our other ethical responsibilities in accordance with the

SIA Code and in accordance with other ethical requirements

applicable to performing audits in Swaziland. The SIA Code is

consistent with the International Ethics Standards Board for

Accountants Code of Ethics for Professional Accountants (Parts A

and B). We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for our opinion.

Other Information

The main committee is responsible for the other information. The

other information comprises the statement of responsibility by

the Main Committee and the Appendices attached to the financial

statements, which we obtained prior to the date of this report.

Other information does not include the financial statements and

our auditor’s report thereon.

Our opinion on the financial statements does not cover the other

information and we do not express an audit opinion or any form of

assurance conclusion thereon.

In connection with our audit of the financial statements, our

responsibility is to read the other information and, in doing so,

consider whether the other information is materially inconsistent

with the financial statements or our knowledge obtained in the

audit, or otherwise appears to be materially misstated. If, based on

the work we have performed on the other information obtained

prior to the date of this auditor’s report, we conclude that there is

a material misstatement of this other information, we are required

to report that fact. We have nothing to report in this regard.



Responsibilities of the Main Committee for the Financial

Statements

The Main Committee is responsible for the preparation and

presentation of the financial statements in accordance with the

basis of accounting described in the statement of significant

accounting policies set out on pages 23 to 27, for determining

the acceptability of the basis of accounting and for such internal

control as the Main Committee determine is necessary to enable

the preparation of financial statements that are free from material

misstatement, whether due to fraud or error.

In preparing the financial statements, the Main Committee is

are responsible for assessing the ability of Tibiyo Taka Ngwane

to continue as a going concern, disclosing, as applicable, matters

related to going concern and using the going concern basis of

accounting unless the Main Committee either intend to liquidate

the entity or to cease operations, or have no realistic alternative

but to do so.

Auditor’s Responsibilities for the Audit of the Financial

Statements

Our objectives are to obtain reasonable assurance about whether

the financial statements as a whole are free from material

misstatement, whether due to fraud or error, and to issue an

auditor’s report that includes our opinion. Reasonable assurance

is a high level of assurance, but is not a guarantee that an audit

conducted in accordance with ISAs will always detect a material

misstatement when it exists. Misstatements can arise from fraud

or error and are considered material if, individually or in the

aggregate, they could reasonably be expected to influence the

economic decisions of users taken on the basis of these financial

statements.

As part of an audit in accordance with ISAs, we exercise professional

judgement and maintain professional scepticism throughout the

audit. We also:

Identify and assess the risks of material misstatement of the

financial statements, whether due to fraud or error, design

and perform audit procedures responsive to those risks, and

obtain audit evidence that is sufficient and appropriate to

provide a basis for our opinion. The risk of not detecting a

material misstatement resulting from fraud is higher than

for one resulting from error, as fraud may involve collusion,

forgery, intentional omissions, misrepresentations, or the

override of internal control.

Obtain an understanding of internal control relevant to the

audit in order to design audit procedures that are appropriate

in the circumstances, but not for the purpose of expressing

an opinion on the effectiveness of the company’s internal

control.

Evaluate the appropriateness of accounting policies used

and the reasonableness of accounting estimates and related

disclosures made by the Main Committee.

Conclude on the appropriateness of the Main Committees’

use of the going concern basis of accounting and based on

the audit evidence obtained, whether a material uncertainty

exists related to events or conditions that may cast significant

doubt on the entity’s ability to continue as a going concern.

If we conclude that a material uncertainty exists, we are



required to draw attention in our auditor’s report to the related

disclosures in the financial statements or, if such disclosures

are inadequate, to modify our opinion. Our conclusions are

based on the audit evidence obtained up to the date of our

auditor’s report. However, future events or conditions may

cause the entity to cease to continue as a going concern.

Evaluate the overall presentation, structure and content

of the financial statements, including the disclosures, and

whether the financial statements represent the underlying

transactions and events in a manner that achieves fair

presentation.

We communicate with the Main Committee regarding, among

other matters, the planned scope and timing of the audit and

significant audit findings, including any significant deficiencies in

internal control that we identify during our audit.

Auditors


REPORT OF THE MAIN COMMITTEE for the year ended 30 April 2017

The members of the Main Committee have pleasure in presenting

these financial statements for the year ended 30 April 2017.

Nature of the organisation’s business

Tibiyo Taka Ngwane (Tibiyo) was created by the Royal Charter

on 19 August 1968 by King Sobhuza II for the purpose of

managing projects and investments on behalf of the Swazi Nation.

Investments are registered in the name of the iNgwenyama as

Trustee for the Swazi Nation. The organisation is essentially

a developmental agency with the objectives of enhancing the

economic development of Swaziland and the welfare of its citizens

by providing assistance to the Swazi Nation to preserve its customs

and traditional institutions and for the education and training of

its citizens.

To achieve these objectives the organisation seeks to be actively

involved in the establishment of commercially viable projects in all

sectors of the economy. These projects are managed by Tibiyo,

experienced local or international organisations, or operated as

a joint venture with other business partners who have an equity

stake in the project.

Accounting policies

The Royal Charter does not prescribe the accounting framework

or policies to be used and the Main Committee has therefore

developed transparent, entity specific accounting policies, as

described in the statement of significant accounting policies set

out on pages 8 to 11, to meet the financial requirements of the

entity and the users of its financial statements.

The Main Committee is satisfied that this basis of preparation and

presentation is suitable for the intended users of the financial

statements and meets the requirements of the Royal Charter for

the preparation of financial statements.

State of the organisation’s affairs

The organisation’s affairs are fully disclosed in the attached

financial statements.

Members of the Main Committee

The Main Committee is appointed by the iNgwenyama.

Members of the Main Committee as at date of signing these

financial statements were:

HRH Prince Fipha (Chairman)

HRH Prince Simelane

HRH Princess Sidvumolesihle

Chief N Ndwandwe

Chief N Simelane

S Motsa

V Fakudze

M Fakudze (Resigned 31 August 2016)

M Khumalo (Resigned 31 October 2016)

K Cindzi

L Dlamini

N Gamedze

J Mngomezulu (Resigned 01 May 2017)

C Magagula (Appointed 01 August 2017)

REPORT OF THE MAIN COMMITTEE for the year ended 30 April 2017 - continued


N Rijkenberg (Appointed 01 November 2017)

Dr. A T Dlamini (Managing Director)

W Z Lomahoza (General Manager)

N F Shongwe (Legal advisor and secretary)

Business address Postal address

Lomawa House P O Box 181

Lozithehlezi Kwaluseni

M201

Auditors

KPMG

Umkhiwa House

Lot 195 Kal Grant Street

Mbabane

Bankers

African Alliance Swaziland

First National Bank of Swaziland Limited

Nedbank Swaziland Limited

Standard Bank Swaziland Limited

Stanlib Swaziland

SwaziBank

Swaziland Building Society


STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

Statement of compliance

The financial statements of the organisation have been prepared in accordance with the accounting policies stated below.

Basis of preparation

The financial statements are presented in Emalangeni, the functional currency of the organisation, rounded to the nearest one Lilangeni.

They are prepared on the historical cost basis except that the following assets are stated at their fair value: investments classified as held

for trading, investments classified as available for sale, cane roots and growing cane. The financial statements incorporate the following

principal accounting policies which are materially consistent with those adopted in the previous financial year.

Consolidation

The organisation does not present consolidated financial statements.

Associated companies

An associated company is one in which Tibiyo Taka Ngwane holds, as a long-term investment, between 20 per cent and 50 per cent of the

equity capital or, where the holding is less than 20 per cent, has significant influence.

The equity method of accounting for associated companies is adopted in the financial statements. In applying the equity method, Tibiyo

Taka Ngwane’s share of accumulated post-acquisition retained earnings and movements in reserves is accounted for from the date on

which the company became an associated company.

The post-acquisition retained earnings and reserves of associated companies attributable to the organisation are transferred to a capital

reserve.

An appropriate impairment is made where, in the opinion of the Main Committee, there has been a permanent diminution in the carrying

value of an investment in an associated company.

The share of associated companies’ retained earnings and reserves are determined from their latest audited financial statements.

STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES - continued


Investments

Investments are classified for valuation purposes as either held-to-maturity, available-for-sale, held for trading or loans originated by the

organisation. Investments held-to-maturity are classified as non-current assets and are reflected at amortised cost. Investments held

for trading are reflected at fair value with any increase or decrease in fair value recognised in the statement of comprehensive income.

Investments considered to be available-for-sale are reflected at fair value with any resultant gain or loss recognised in the statement of

comprehensive income. Loans originated by the organisation are classified as non current assets and are reflected at cost. Fair value is

determined by the organisation using quoted prices where the investment is traded in an active market or where fair value can be reliably

measured. Where fair value cannot be reliably measured investments are reflected at cost. Income is brought to account to the extent of

dividends declared or interest earned.

Revenue

Revenue comprises revenue earned from sucrose sales, share of partnership earnings, interest and dividends earned from investments.

Revenue from the sale of sucrose is recognised in the statement of comprehensive income when significant risks and rewards of ownership

have been transferred to the buyer.

Dividends earned from investments are recognised in the statement of comprehensive income when they are declared by investee

companies.

Interest income is recognised in the statement of comprehensive income as it accrues, using the effective interest rate method.

Retirement and termination benefits

The policy of the organisation is to provide retirement benefits for all its employees by way of a pension fund or a provident fund. Current

contributions to the pension and provident funds operated for employees are charged against income as incurred. The costs of improved

pension benefits or any deficits arising from time to time on such funds are funded by way of increased future contributions.

Preliminary project expenses

Preliminary project expenses are written off if the project concerned does not become viable and are refunded or capitalised, as an equity

interest, if the project becomes viable.



Acquisition of land and improvements for the Swazi Nation

It is a policy of Tibiyo to purchase land, buildings and other assets on behalf of the Swazi Nation. The land so acquired does not vest in

Tibiyo Taka Ngwane as such but is registered in the name of the iNgwenyama as Trustee for the Swazi Nation. The accumulated costs of

acquisition of such land, improvements and other assets less accumulated depreciation, where applicable, are treated as follows:

Land, improvements and other assets which are utilised and controlled by Tibiyo Taka Ngwane for its various agricultural and other

projects are reflected as property, plant and equipment.

Land, improvements and other assets which are utilised by the community and not controlled by Tibiyo Taka Ngwane are reflected as

a deduction from accumulated funds and reserves.

Property, plant and equipment and depreciation

Items of property, plant and equipment are stated at cost less accumulated depreciation and impairment losses. Depreciation is charged

on the straight line basis at rates which will reduce their book values to estimated residual values over the anticipated useful lives of the

assets using the following rates:

Land 0 years

Buildings and capital improvements 50 years

Fencing, water development and other improvements 10 years and 5 years

Motor vehicles 5 and 4 years

Furniture, fittings and equipment 10 and 3.33 years

Assets are depreciated from the date of acquisition to the date of disposal. The basis of depreciation, useful lives and residual values

is assessed annually. Expenditure on repairs and maintenance of property, plant and equipment incurred to restore or maintain future

economic benefits expected from the assets is recognised as an expense when incurred.

Inventories

Inventories are valued at the lower of cost and net realisable value. Cost is determined using the first-in first-out method.

Redundant and slow moving inventories are identified and written down to their estimated net realisable value.


Subventions

From time to time the organisation grants subventions to wholly owned subsidiaries that are under financial stress in order for these entities

to continue operations in order to meet their developmental goals.

These subventions are approved by the Main Committee.

Swazi Nation development expenditure

Tibiyo Taka Ngwane utilises a portion of its income for:-

(a) the promotion of the health, welfare, education and housing of the Swazi Nation;

(b) the general maintenance and administration of the traditional institutions of the Swazi Nation;

(c) the funding of traditional ceremonies; and

(d) generally, any other purpose the iNgwenyama considers to be beneficial to the Swazi Nation and which will further their interests.

Such expenditure is reflected as Swazi Nation development expenditure and is included in the statement of changes in funds and reserves.

Rental

Rental income is brought to account on a straight line basis over the lease term after deducting maintenance costs.

Financial instruments

Financial assets include cash and bank balances, listed investments and interest earning investments not held to maturity, loans originated

by the organisation, interest earning investments held to maturity and accounts receivable. Cash and bank balances, listed investments

and interest earning investments not held to maturity are carried at fair value. Loans originated by the organisation and interest earning

investments held to maturity are carried at cost and amortised cost. Accounts receivable classified as current assets are carried at cost less

impairment losses.

Financial liabilities include bank overdrafts, accounts payable provisions and loans and borrowings. These are carried at cost and

subsequently measured at amortised costs.




Growing cane

Growing cane is valued at fair value determined by the estimated sucrose content valued at the estimated sucrose price for the following

season, less estimated costs for harvesting and transport

Comparative figures

When an accounting policy has changed and the results thereof are material for the appreciation of the financial position of Tibiyo Taka

Ngwane, the comparative figures are restated in accordance with the new policy.

Cane roots

Tibiyo Taka Ngwane has adopted the amendments made to IAS16 and IAS41 in relation to bearer plants this year. These amendments have

resulted in changes to accounting policies and adjustments to the amounts previously recognised in the financial statements.

In June 2014, the IASB made amendments to IAS 16 Property, Plant and Equipment and IAS 41 Biological Assets which distinguish bearer

plants from other biological assets. Bearer plants are solely used to grow produce over their productive lives and are seen to be similar to

an item of machinery. They will therefore now be accounted for under IAS 16. However, agricultural produce growing on the bearer plants

will remain within the scope of IAS 41 and continue to be measured at fair value less cost to sell.

Sivunga Farm’s cane roots qualify as bearer plants under the revised definition in IAS 41. As required under IAS 8, the change in accounting

policy has been applied retrospectively. As a consequence, the cane roots were reclassified to property, plant and equipment effective 1

May 2015 and comparative figures have been restated accordingly.

The cane roots are now measured using the historical cost method and depreciated over their useful lives which range from five years

to ten years depending on the soil profile and irrigation systems employed. This resulted in a decrease of E 28 364 539 in the opening

balance of cane roots to E 20 554 589 (2016: E 48 919 131).


STATEMENT OF COMPREHENSIVE INCOME

Note 2017 2016

E E

Revenue

Third party managed projects 110 522 770 93 588 523

Interest received from investments 6 614 497 4 799 925

Dividends received from investments 162 091 474 118 537 210

Share of partnership earnings 20 522 923 22 018 822

299 751 664 238 944 480

Direct operating expenses

Third party managed projects (96 290 167) (85 600 657)

Operating income for the year 203 461 497 153 343 823

Sundry income 1 32 055 545 7 834 998

Fair value adjustments on biological assets (55 589 051) (213 914)

Effect of change in accounting policy - (28 364 539)

179 927 991 132 600 368

Indirect operating expenses (65 502 475) (50 092 922)

Interest expense 12 (5 877 603) (2 527 397)

Effect of change in accounting policy - (28 364 539)

Net income for the year before subventions 2 108 547 913 79 980 049

Subventions 3 (8 367 271) (14 607 024)

Net income for the year after subventions 100 180 642 65 373 025

Share of associated companies equity earnings 65 369 991 80 054 392

Net income for the year 165 550 633 145 427 417


STATEMENT OF CHANGES IN FUNDS AND RESERVES

Capital Accumulated

reserve funds

E E E

Balance at 1 May 2015 1 098 768 996 571 860 563 1 670 629 559

Net income for the year - 145 427 417 145 427 417

Swazi Nation development expenditure - (109 218 195) (109 218 195)

Transfer of equity losses from capital reserve 80 054 392 (80 054 392) -

Balance at 30 April 2016 1 178 823 388 528 015 393 1 706 838 781

Balance at 1 May 2016 1 178 823 388 528 015 393 1 706 838 781

Effect of change in accounting policy - 28 364 539 28 364 539

Net income for the year - 165 550 633 165 550 633

Swazi Nation development expenditure - (144 469 067) (144 469 067)

Transfer of equity earnings to capital reserve 65 369 991 (65 369 991) -

Balance at 30 April 2017 1 244 193 379 512 091 507 1 756 284 886


STATEMENT OF FINANCIAL POSITION

Note 2017 2016 2015 Restated Restated

E E E

ASSETS

Non-current assets

Property, plant and equipment 5 139 526 169 143 383 865 143 383 865

Investments (Appendix 1) 1 501 613 443 1 433 645 561 1 349 393 727

Cane roots 7 - - -

1 641 139 612 1 596 373 731 1 516 619 542

Current assets Inventories 6 2 579 819 4 731 328 965 027Growing cane 7 8 487 717 38 566 511 68 938 000Loans and accounts receivable 8 138 275 652 80 864 075 85 520 884Short term securities 11.2 114 794 370 101 845 549 61 445 146Bank balances and cash 11.2 10 133 787 36 577 44 555

274 271 345 226 044 040 216 913 612

Total assets 1 915 410 957 1 803 073 466 1 710 691 204

FUNDS EMPLOYED AND LIABILITIES

Funds and reserves Capital reserve 9 1 244 193 379 1 178 823 388 1 098 768 996Accumulated funds 512 091 507 528 015 393 571 860 563

1 756 284 886 1 706 838 781 1 670 629 559

Deduct: Land and improvements acquired on behalf of

the Swazi Nation 10 (36 784 344) (36 763 527) (34 839 214) 1 719 500 542 1 670 075 254 1 635 790 345

Non-current liabilities

Loans and borrowings 12 63 601 250 64 027 397 -

63 601 250 64 027 397 -

Current liabilities

Accounts payable 131 062 921 68 393 363 73 438 907

Bank overdrafts 11.2 1 246 244 577 452 1 461 952

132 309 165 68 970 815 74 900 859

Total funds employed and liabilities 1 915 410 957 1 803 073 466 1 710 691 204


STATEMENT OF CASH FLOWS

Note 2017 2016

E E

Cash flows from operating activities

Cash generated by operations 11.1 153 755 205 108 188 639

Interest received 6 614 497 4 799 925

Interest paid 12 (6 303 750) -

Net cash flows from operating activities 154 065 952 112 988 564

Cash flows from investing activities

Acquisition of land and improvements for the Swazi Nation (20 820) (1 924 313)

Additions to property, plant and equipment (5 007 481) (3 265 019)

Proceeds from disposal of property, plant and equipment 27 173 817 354

Investments acquired (997 891) (4 197 442)

Net cash flows from investing activities 21 147 625 (9 386 420)

Cash flows from financing activities

Subventions (8 367 271) (14 607 024

Swazi Nation development expenditure 4 (144 469 067) (109 218 195)

Proceeds from loans - 61 500 000

Net cash flows from financing activities (152 836 338) (62 325 219)

Net increase/(decrease) in cash and cash equivalents 22 377 239 41 276 925

Cash and cash equivalents at beginning of year 11.2 101 304 674 60 027 749

Cash and cash equivalents at end of year 11.2 123 681 913 101 304 674


NOTES TO THE FINANCIAL STATEMENTSfor the year ended 30 April 2017

2017 2016

E E

1. Sundry income

Rental income 5 522 470 5 651 085

Other income 5 621 176 2 147 420

Interest on staff loans 22 150 36 139

Surplus on disposal of property, plant and equipment 20 889 749 354

32 055 545 7 834 998

2. Net income for the year before subventions

Is arrived at after charging/(crediting):

Audit fee 394 469 358 722

Depreciation of property, plant and equipment 5 435 394 6 058 055

Depreciation of land and improvements acquired on behalf of Swazi Nation 1 165 601 1 384 227

Consultancy fees 320 285 602 174

Investment promotion expenditure 928 033 362 432

Surplus on disposal of property, plant and equipment (20 889 749) (354)

Management fees 1 270 283 1 014 439

Main Committee fees and expenses 1 679 612 1 509 907


NOTES TO THE FINANCIAL STATEMENTSfor the year ended 30 April 2017 - continued

2017 2016

E E

3. Subventions

Tibiyo Properties (Proprietary) Limited 890 913 -

The Swaziland Observer (Proprietary) Limited 687 021 948 408

Tibiyo Leisure Resorts (Proprietary) Limited 5 614 535 12 266 132

Dalcrue Agricultural Holdings (Proprietary) Limited 1 174 802 1 392 484

8 367 271 14 607 024

4. Swazi Nation development expenditure

Bursaries and scholarships 38 624 007 31 700 975

Cost of services 6 962 484 5 540 889

Health care 2 075 674 5 511 011

National ceremonies 36 248 331 26 115 112

Sundry expenses 56 849 859 51 609 762

Donations 392 459 108 319

Contract expenditure /(income) 3 316 253 (11 367 873)

144 469 067 109 218 195



Accumulated Net book Cost depreciation value E E

5. Property, plant and equipment

2017

Farms 29 416 794 - 29 416 794

Land, buildings and improvements 137 205 129 (57 918 665) 79 286 464

Motor vehicles 11 830 827 (11 170 912) 659 915

Furniture, fittings and equipment 17 912 527 (11 158 405) 6 754 122

Cane roots 39 257 041 (15 848 167) 23 408 874

235 622 318 (96 096 149) 139 526 169

2016

Farms 34 662 394 - 34 662 394 Land, buildings and improvements 128 430 126 (49 431 727) 78 998 399 Motor vehicles 12 110 718 (10 870 523) 1 240 195 Furniture, fittings and equipment 20 329 414 (12 401 126) 7 928 288 Cane roots 33 874 041 (13 319 452) 20 554 589

229 406 693 (86 022 828) 143 383 865

Opening Closing net book Dis- Depre- net book

value Additions Reversal posals ciation value E E E E E E

5.1 Reconciliation of book

values

2017

Farms 34 662 394 - (5 245 600) - - 29 416 794

Land, buildings and improvements 78 998 399 4 377 148 (1 007 376) - (3 081 707) 79 286 464

Motor vehicles 1 240 195 295 109 - - (875 389) 659 915

Furniture, fittings and equipment 7 928 288 335 224 (31 092) - (1 478 298) 6 754 122

Cane roots 20 554 589 6 116 223 - - (3 261 938) 23 408 874

143 383 865 11 123 704 (6 284 068) - (8 697 332) 139 526 169



Opening Closing

net book net book value Additions Disposals Depreciation value E E E E E

5.1 Reconciliation of book values

2016

Farms 34 662 394 - - - 34 662 394

Land, buildings and improvements 80 452 220 3 044 567 - (4 498 388) 78 998 399

Motor vehicles 2 085 831 - - (845 636) 1 240 195

Furniture, fittings and equipment 8 421 867 220 452 - (714 031) 7 928 288

Cane roots 18 830 848 3 606 826 - (1 883 085) 20 554 589

144 453 160 6 871 845 - (7 935 140) 143 383 865

2016 2015

E E

6. Inventories

Fuel 138 192 211 699

Cattle for ceremonies 2 441 627 4 519 629

2 579 819 4 731 328



7. Growing crop

7.1 Description of principal activities

The organisation’s fields are situated in the Big Bend and Tshaneni areas and consist of 2 761 hectares (2016: 2 761 hectares) of

sugar cane. The management, planting and harvesting of sugar cane has been outsourced to two related party companies involved

in similar operations. Fields are managed on a sustainable basis with approximately 11% of the area replanted per annum.

Cane roots

E

7.2 Reconciliation of carrying amounts

Carrying amount at 1 May 2016 38 566 511

Adjustment for changes in fair values (55 589 051)

Carrying amount at 30 April 2016 31 896 591

7.3 Measurement base

Cane roots and growing cane are valued at fair value as detailed in the accounting policy. Agricultural land is carried at cost.

7.4 Specific risk management strategies

The organisation follows prudent industry accepted care practices with respect to the use of fertilisers, insecticides and herbicides

to control growth, diseases and insect infestation. The organisation does not insure growing crops in the fields.



2017 2016

E E

8. Loans and accounts receivable

Related party receivables 38 488 437 43 737 410

Other receivables 42 375 638 41 783 474

80 864 075 85 520 884

9. Capital reserve

Balance at beginning of year 1 098 768 996 871 455 175

Share of equity earnings

Current year earnings 80 054 392 227 313 821

Balance at end of year 1 178 823 388 1 098 768 996

10. Land and improvements acquired on behalf of the Swazi Nation

Buildings 3 220 877 3 220 877

Farms 12 469 856 12 469 856

Mineral rights 354 994 354 994

Other assets 20 717 800 18 793 487

36 763 527 34 839 214



2017 2016 E E

11. Notes to the statement of cash flows

11.1 Cash generated by operations

Net income for the year before subventions 108 547 913 79 980 049 Adjusted for:

Depreciation of property plant and equipment 5 435 394 7 935 140

Interest income received (6 614 497) (4 799 925) Interest expense 5 877 603 2 527 397 Provision reversal (1 600 000) - Surplus on disposal of property, plant and equipment (20 889 749) (354) Effect of change in accounting policy - 28 364 539

Change in fair value of growing cane 52 327 113 1 663 171

Net operating income for the year before working capital changes 146 345 715 112 343 675 Decrease/(increase) in inventories 2 151 509 (3 766 301) (Increase)/ decrease in loans and accounts receivable (57 411 577) 4 656 809

Increase/ (decrease) in accounts payable 62 669 558 (5 045 544)

153 755 205 108 188 639

11.2 Cash and cash equivalents

Cash and cash equivalents included in the cash flow statement comprise the following balance sheet amounts:

Opening balances

Bank balances and cash 36 577 44 555

Short term securities 101 845 549 61 445 146

Bank overdrafts (577 452) (1 461 952)

101 304 674 60 027 749

Closing balances

Bank balances and cash 10 133 787 36 577

Short term securities 114 794 370 101 845 549

Bank overdrafts (1 246 244) (577 452)

123 681 913 101 304 674



2017 2016 E E

12. Loans and borrowings

Opening balance 64 027 397 -

Loan amount - 60 000 000

Transaction costs - 1 500 000

Interest expense 5 877 603 2 527 397

Interest repayments (6 303 750) -

Loans and borrowings 63 601 250 64 027 397

On 20 January 2015, Tibiyo Taka Ngwane set up a subsidiary known as Structco (Proprietary) Limited. The company is to carry on the business of an investment company and to invest in immovable and movable property, shares, stocks and debentures. Structco issued 10.25% redeemable debentures to African Alliance and subsequently provided a loan to Tibiyo Taka Ngwane at an interest of 10.25%. The principal amount is E61 500 000, which includes E1 500 000 transaction costs. The loan is secured over the shares held by Tibiyo Taka Ngwane at the Royal Swaziland Sugar Corporation and is payable in a lump sum at the end of its 5 year term, 31

December 2020. Interest is payable annually.

13. Retirement benefits

All eligible employees belong to a defined benefit pension or a provident fund. The pension fund is actuarially valued, in terms of the rules of the fund, every three years. The latest valuation was carried out at 30 April 2012, which revealed a surplus of E99 344.

The 2017 actuarial valuation had not been carried out as at the day of issue of these financial statements.

The provident fund is actuarially valued every year. The last valuation was carried out as at 30 April 2015 which revealed a deficit of E71 679. The 2017 actuarial valuation had not been carried out as at the day of issue of these financial statements.

The organisation made contributions amounting to E2 150 147 (2016: E2 108 006) to the funds during the year.

14. Employees and employment costs

The number of employees employed by the organisation at year-end was 81 (2016: 86).

Employment costs during the year for the organisation amounted to E29 761 795 (2016: E29 328 032).

15. Related parties

15.1 Related parties comprise subsidiaries, associates and members of the Main Committee. Details of balances for income received

from subsidiaries and associates are set out in Appendix 1 of the financial statements.

Related party transactions comprise dividends received, subventions paid, retains fees, sitting allowances and interest received. Certain reimbursive expenditure is recouped by related parties.



15. Related parties (continued)

15.2 Related party contingent liabilities and commitments

Related party contingent liabilities and commitments are disclosed in note 16.

Details of related party balances and transactions are disclosed in the appendices to these financial statements.

16. Financial instruments

Financial assets of the organisation include investments, cash and bank balances, loans and accounts receivable. Financial liabilities

of the organisation include bank overdrafts, loans and borrowings and accounts payable. Accounting policies for financial assets and

liabilities are set out in the statement of accounting policies.

Interest rate risk

Bank overdrafts loans and borrowings and bank balances attract interest at rates linked to the prime overdraft rate as applicable in

Swaziland on a floating rate basis.

Credit risk

Credit risk represents the accounting loss that would be recognised at financial year-end in the event of non-payment by debtors.

The organisation has no significant credit risk exposures. To reduce exposure to credit risk the organisation performs ongoing credit

evaluations of the financial conditions of its debtors and obtains collateral as necessary. The organisation invests available cash and

cash equivalents with banks. The organisation is exposed to credit related losses in the event of non-payment but does not expect

any significant debtor to fail to meet its obligations.

Foreign exchange hedge instruments and exposures

The organisation had no foreign exchange hedge instruments outstanding or any foreign currency exposures at financial year-end.

Fair values

The balances, as reflected in the statement of financial position, of financial instruments of the organisation are not materially

different from their carrying amounts.

17 Contingent liabilities and guarantees

17.1 As part of its bank facilities the organisation has the following performance guarantees:

Cession of rental in terms of lease contracts dated 14 December 2006 to Standard Bank.

Surety bond for E7 000.00 with Nedbank Swaziland Limited in favour of Customs and Excise dated 4 July 2001.



17. Contingent liabilities and guarantees (continued)

17.2 The organisation grants scholarships to students for educational purposes. Certain conditions are attached to the scholarships

and these may be revoked should students not comply. It is the organisation’s policy to provide for scholarships payable in the

following year, whilst amounts due thereafter are considered to be contingent on students complying with all the conditions

attached to the scholarships. Renewal of the scholarships is at the discretion of the organisation. The organisation has

commitments in respect of scholarships awarded which would be payable as shown below:

2017 2016

E E

Payable in the next year and included in accounts payable 25 854 224

Payable between 2 and 5 years 60 082 439

85 936 663

17.3 The entity has sub-ordinated its loan to Dalcrue Agricultural Holdings (Pty) Limited in favour of other creditors until the assets of

Dalcrue Agricultural Holdings (Pty) Limited fairly valued exceed its liabilities.

17.4 The entity has sub-ordinated its loan to Tibiyo Leisure Resorts (Proprietary) Limited in favour of other creditors until the assets

Tibiyo Leisure Resorts (Proprietary) Limited fairly valued exceed its liabilities.

17.5 The entity has sub-ordinated its loan to Tibiyo Properties (Proprietary) Limited in favour of other creditors until the assets of Tibiyo

Properties (Proprietary) Limited fairly valued exceed its liabilities.

17.6 The entry was pledged its shareholding at Royal Swaziland Sugar Corporation to the favour of African Alliance Securities Trading

(Proprietary) Limited on behalf of a debenture by its subsidiary Structco (Pty) Limited to the value of E120 million.


NOTES

E-mail: [email protected]: www.tibiyo.com

ANNUAL REPORT 2016 - Tibiyo annual...Dr. Absalom Themba Dlamini Fipha Dlamini Managing Director...

Documents

Transcript of ANNUAL REPORT 2016 - Tibiyo annual...Dr. Absalom Themba Dlamini Fipha Dlamini Managing Director...